What You Should Know About Suing Big Insurance Companies in Arizona
A bad faith claim is a legal term that describes a claim that an insured person may have against their insurance company for bad acts.
Whether you have a homeowners’ insurance policy claim, a commercial insurance policy claim, or an automobile insurance claim that is being delayed, unfairly evaluated, or wrongfully denied, you are discovering the truth about large insurance companies: The insurance company will fight tooth and nail to avoid paying you the benefits you are entitled to. To avoid paying legitimate claims, they frequently delay, deny, and lie. They rely on claimants to give up, accept a low-ball settlement, or simply disappear.
This article examines Arizona’s bad faith claims, including the duties that an insurance company owes under state law and the damages that can be recovered when those duties are breached.
A summary of Arizona’s bad faith laws
All insurance contracts in Arizona include an implied covenant of good faith and fair dealing.
In layman’s terms, this means that your insurance company must deal with you (the “insured”) honestly, fairly, and in good faith, for you to receive the benefits of the insurance contract.
If your insurance company violates this implied covenant of good faith and fair dealing, you can sue for bad faith.
Background of Arizona Bad Faith Claims
Large insurance companies prioritize profit over everything else.
An insurance company’s primary source of profit should be through investments and proper, fair premiums. An insurance company should never profit from its claims procedures and practices. When you pay your premium, your funds are invested in a variety of ways. Many of the investments made by insurance companies have resulted in losses as a result of poor investment decisions or the economy. This makes insurance companies even more aggressive in their refusal to pay claims fairly, putting policyholders in financial jeopardy.
Insurance companies purposefully complicate the claim process.
Every day, thousands of insurance claims are filed in Arizona. Unfortunately, many insurance companies make the claim process complex, confusing, and unnecessarily burdensome, resulting in a small number of insured parties contesting unfair insurance claim decisions. The insurance company has a maze of corporate policies and procedures in place to discourage people from seeking just compensation. Only a qualified attorney can sort through the majority of the paperwork and legal jargon required to sue an insurance company.
Profits are maximized at all costs by insurance companies.
Although Allstate, State Farm, and Farmers Insurance are the most well-known examples, countless other insurance companies have been found to have violated the duty of good faith and fair dealing.
According to several news articles and numerous civil lawsuits filed against these and other insurance companies, insurance companies frequently consult with business consultants to find ways to increase their profits. What is the advice? Create corporate policies and procedures to pay out fewer claims at the expense of the insurance consumer. Offer a lower-ball, arbitrary evaluation when a claim should be paid. Many insurance customers take these offers and then walk away.
How long does a bad faith lawsuit take?
Arizona bad faith claims have a 2-year statute of limitations that begins to run the moment the insurance company commits the wrongdoing.
This means that you must file your lawsuit within two years of the date the insurance company commits the wrongdoing, or your lawsuit will be dismissed.
How to prove a bad faith claim in Arizona?
In Arizona, the burden of proving a bad faith claim falls on the insured. To do so, you must demonstrate the following two points:
- The insurance company acted inappropriately, and
- The insurance company knew its behavior was unreasonable, or the behavior was so reckless that knowledge should be attributed to the insurance company.
What to Do If Your Insurance Company in Arizona Is Mistreating You
There are a few things you should do if you suspect your insurance company is acting in bad faith.
- Examine your insurance policy. To be sure, if you are unfamiliar with insurance terminology, this can be intimidating. However, understanding exactly what your policy covers is critical in knowinghow to fight back against the insurance company. A skilled attorney can also assist you in deciphering the policy’s language, but this review of your insurance policy is critical. Insurance companies rely on policyholders who are unaware of their rights.
- Consider canceling your insurance policy and finding a new insurance provider. In Arizona, you have many options for insurance coverage. You do not have to pay an insurance company whose services you do not find useful and who has mistreated you. In most cases, you do not have to be a policyholder with your bad faith insurance company when you file a lawsuit.
- In Arizona, contact an attorney who has experience with insurance bad faith. This is a very complicated area of law. Moreover, all of the major insurance companies will have teams of adjusters, investigators, and attorneys working against you.
Disclaimer: Every effort was made at the time of publication to ensure the accuracy of this publication. Individual circumstances will vary, and the law may have changed since publication, thus it is not intended to provide legal advice or imply a certain outcome. Readers considering legal action should seek legal advice from an experienced attorney to learn about current laws and how they can affect their case.